An interesting shift is taking place in the world of Fintech funding right now. Even though the total amount of VC funding in Fintech is slowing down, the money flowing to blockchain companies continues to grow. Newer areas of financial technology are always a great source of innovation. Together with Insurtech, blockchain is now one of the leading investment sectors.

The Fintech Funding Shift Is Taking Place

Venture capitalists always want to explore the new and hot trends in any industry. For financial technology and services, those areas are Insurtech and blockchain right now. Or that seems to be the case when looking at money flowing into

Over the past few quarters, the number of money invested in blockchain companies has been increasing exponentially. Things were looking quite good in 2014, but 2015 has proven to be an even better year. In the first half of 2016, nearly as much money was invested in blockchain projects compared to all of 2015. At the same time, the number of funding rounds related to blockchain has been declining, albeit it seems 2016 will beat last year’s numbers as well.

To be more precise, blockchain investments beat all other sectors in the Fintech sectors when looking at the 2015 numbers. Half of the 2015 Fintech funding went to distributed ledger companies, and two in three firms successfully raising money are actively developing blockchain solutions.

As one would come to expect, raising VC funding as a blockchain company requires more than snapping fingers. The most successful companies have active use cases in place already. The majority of startups exploring this technology, however, promises to create use cases, albeit most of them are still just a proof of concept.

Without proper applications, blockchain technology has no use to the average person. Then again, a lot of these projects should come to fruition in the next few months. For now, venture capitalists are still pumping a lot of money into this technology. But unless results are shown soon, that situation may come to change.

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